Bear Put Spread

Market Terms

We don't know everything about the markets.  We're just devoted to learners.  Taken from those smarter than ourselves, here's how we define Bear Put Spread.

An options trading strategy used by a bearish investor to maximize profit and minimize loss.  When the trader expects the decline of a security or asset price, a bear put spread may be implemented by purchasing put options while also selling the same number of puts on the same asset within the same expiration date at a lower strike price.  This means that the maximum profit is equivalent to the difference between the two strike prices (minus the cost of the options themselves).